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Trump Media Merger Partner Reveals a $18 Million Preliminary Settlement With The SEC

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Trump Media Merger Partner Reveals a $18 Million Preliminary Settlement With The SEC

(CTN News) – The company that intends to take Donald Trump’s media business public has agreed to pay an additional $18 million to settle a regulatory investigation relating to its initial public offering and its proposed merger with Trump’s company.

In a filing on Monday, the Securities and Exchange Commission’s division of enforcement announced that the company had reached a “principle agreement” with Digital World Acquisition Corporation.

This agreement is subject to approval by the Securities and Exchange Commission and will only become payable if the merger deal with Trump Media & Technology Group is completed.

According to the agreement, DWAC will enact a cease-and-desist order in connection with the company’s IPO “finding that certain antifraud provisions were violated,” and a so-called S-4 filing “relating to certain statements, agreements and omissions about the timing and discussions the company had with TMTG regarding the proposed business combination” in relation to the IPO.

DWAC had been under investigation by the Securities and Exchange Commission (SEC) for violating securities laws by holding talks with TMTG before it listed on the NYSE. There is a requirement for special purpose acquisition companies (Spacs) such as DWAC to disclose to their investors if they have had discussions with potential targets before they go public.

Since September 2021, DWAC has been a publicly traded company.

In a few weeks, the company announced its merger with TMTG, which operates Trump’s Truth Social platform, and announced the merger a few days later.In spite of this,

A whistleblower complaint filed by a former executive at Trump’s media group alleges that the Spac made “fraudulent misrepresentations” about its discussions with the former president’s business which were “substantial” prior to the IPO of its company.

In order to get the DWAC-TMTG deal over the line, an agreement with the SEC could be a significant step in the right direction, but there are currently signs of disagreements between the two parties themselves, which will keep the deal from going forward.

According to the filing, DWAC has requested that its shareholders approve an extension of one year to the September 2023 deadline for completing the merger, however TMTG has informed the company that it is only bound by the terms of the merger agreement until the current deadline.

According to the Spac, Trump’s business has continued to delay delivering various deliverables to the company as required under the merger agreement.

In response to a request for comment, the SEC did not respond immediately.

An announcement of a potential settlement comes days after three men involved with Spac, including a former board member, were charged with insider trading by the US attorney in Manhattan.

Additionally, the SEC filed a civil action against the three businessmen, in which it alleged that there were communications between them as early as June 2021 in which they referred to DWAC as “[the] Trump Spac”.


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Salman Ahmad is a seasoned writer for CTN News, bringing a wealth of experience and expertise to the platform. With a knack for concise yet impactful storytelling, he crafts articles that captivate readers and provide valuable insights. Ahmad's writing style strikes a balance between casual and professional, making complex topics accessible without compromising depth.

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